Stimulus strife continues as time runs out

JEFFERSON CITY — The General Assembly and Gov. Jay Nixon have begun to resemble a family squabbling over a deceased relative’s estate.

In this case, the estate is billions of dollars in federal funds from the economic recovery act.

With one week remaining to approve a budget, Nixon, the House and the Senate have different opinions over how about $2 billion in federal stimulus funds should be spent. The differences manifested themselves yesterday, when the House defeated a plan to spend federal dollars on construction projects and later approved a state income tax cut.

Some lawmakers claimed there was “pork” in the projects list while passage of the tax cut amounted to a “circus.”

Among the projects that died, at least for now, was Columbia’s new Ellis Fischel Cancer Center, the $31.2 million on-again-off-again funding item that — despite the voiced support of many — still often ends up on the cutting-room floor.

“While the Ellis Fischel project is not funded in either the current House or Senate bills, that funding could happen in the next week, and the governor’s office is tracking this closely,” Scott Holste, a Nixon spokesman, said today.

Earlier in the week, the House had given first-round approval to spending $353 million in federal funds over a two-year period for projects such as Ellis Fischel, a plant science center in Mexico, Mo., and a $111 million radio network that allows police across the state to communicate with one another in an emergency. But when the funding bill came up for a final vote in the House yesterday, a combination of Democrats and Republicans defeated it.

Holste said Nixon agreed “with the legislature that the current bill simply costs too much.”

House Majority Leader Steven Tilley, R-Perryville, said it was possible for the capital funding legislation to come up again early next week if Budget Chairman Allen Icet, R-West St. Louis County, requested it.

“If he comes to me to reconsider, that’s what we will do and we will pass it,” Tilley predicted.

Shortly after defeating the capital improvements bill, the House agreed to a permanent state individual income tax cut of $463 million per year, which the Republican majority said could be covered by federal stimulus funds. The 86-66 vote broke along party lines, with Republicans supporting and Democrats against.

Under the plan, the state’s individual income tax rate for the highest wage earners would drop from 6 percent to 5.5 percent. Rep. Jeanette Mott Oxford, D-St. Louis, said given the state’s tax brackets, the highest-paid people would realize the greatest benefit from the change.

“The wealthiest 20 percent get 67 percent of the benefit,” Oxford said. The Department of Revenue estimated the tax cut would save $100 annually for someone with a taxable income of $20,000 and save $250 annually for those with a taxable income of $50,000.

Oxford said money the state loses from the tax cut would mean less for health care programs, fewer dollars for diapers for children in foster care and less support for in-home health care services.

Republicans focused the debate on congressional passage of federal stimulus funds. They said the money belonged in taxpayers’ pockets rather than being used for programs or construction projects.

“Whose money is it?” wondered Rep. Shane Schoeller, R-Willard. “Poor people won’t see this if it’s put into building projects.”

The tax cut was added to a Senate-approved bill dealing with tax credits. The bill now goes back to the Senate, where Rep. Chris Kelly, D-Columbia, predicted it would not be adopted.